Why is it so hard to build family-sized apartments in Philadelphia?

When Leonard Bonarek sat on the zoning committee for West Philadelphia’s Garden Court Community Association, the multifamily buildings he saw developers proposing were almost entirely composed of studios and one-bedroom apartments.

When the Good Shepherd Community Church converted into apartments, only a couple of the 35 units had two bedrooms.

“When we asked, they said, ‘We’ve tried building them, but people don’t rent the three-bedrooms,’ ” remembered Bonarek, who served on the zoning committee from 2019 until this past summer. “If there were three bedrooms [in any of the projects we reviewed], they were extremely rare.”

As apartment buildings have become an increasingly important part of Philadelphia’s housing stock, neighborhood groups persistently ask developers about their lack of family-sized units.

What about those who might like to stay in a neighborhood as they have children? Wouldn’t it be nice for a family to be able to live in Mount Airy or Fox Chase without buying — and maintaining — an expensive old home? What about a family moving to Philadelphia that wants to live in a Center City mid-rise, not a suburban home?

The reason smaller apartments dominate the market ranges from the esoterica of zoning and building codes to the kinds of projects developers can get financed. It’s also about a dominant narrative of American life: The city is for young people, who move to the suburbs when they grow older.

“The people who’ve been writing these multifamily codes — both zoning and building — they haven’t thought about families in a long time,” said Stephen Smith, executive director of the New York-based Center for Building, a think tank devoted to construction policy. “We’ve ended up with codes that make it really difficult to build anything other than studios or one bedrooms.”

Some Philadelphia developers say that the market may be shifting, as some urban dwellers look to stay in the city longer and spiking interest rates make buying homes less appealing.

That’s why Post Bros. has more two- to three-bedroom units in its multifamily buildings in Northern Liberties and on South Broad Street than most of its competitors. Others like Carl Dranoff also say they are looking to construct more buildings with larger units. Some builders are finding that their two-bedroom units are leasing surprisingly quickly, like at the Parkway Corp.’s 61-unit Amble building in Old City or Post Bros.’ Piazza Alta in Northern Liberties.

“The two-bedrooms got rented way before the studios, which is not typical in the history of apartment lease ups,” said Michael Pestronk, CEO with the Post Bros., about Piazza Alta. “There’s definitely been lots of demand for twos and threes.”

There is no exact definition of a family unit, but it generally means a multi-bedroom unit that is not being marketed to roommates. An apartment building near Temple or Drexel with four bedrooms, each with a bathroom, is being targeted to students, not families.

Larger apartments for nonstudents aren’t the norm, despite some signs of change. When canvassed for this article, most developers said they don’t build them and don’t plan to.

Partly that’s because Philadelphia, unlike Boston, New York, and Washington, has a vast supply of rowhouses that are still affordable to people in a position to buy. For those who prefer new construction, the past couple decades have seen a burst of modern rowhouse building.

“In our opinion, there’s a limited group of tenants looking for a three-bedroom [apartment],” said Henry Siebert, cofounder of Archive Development, a newer real estate company concentrated in Fishtown. “I feel like rowhouses are probably the best option for families with many kids.”

Another issue is that those who would most like to live in newer family-sized apartments cannot afford one.

New construction is inherently more expensive than older buildings. That’s why lower-income families frequently rent antiquated rowhouses, which often need repair, and also why the Philadelphia Housing Authority’s new apartment buildings have a greater proportion of family-sized apartments than their market-rate counterparts.

But without more subsidies, it’s hard to build for those with the most demand for family units.

Three-bedroom units are “renting slow, under market,” said German Yakubov, a developer who largely works around the periphery of University City in West Philadelphia. “There’s plenty of appetite, just not at the price that is needed to make them feasible. Most families can’t afford it.”

Other developers say the idea there isn’t demand among higher-income Philadelphians is antiquated. In submarkets like Northern Liberties or parts of Center City, there is an appetite for apartments for families. That’s why Dranoff is planning two- and three-bedroom apartments at Broad and Pine Streets.

“People rent because they can make temporary decisions and bide their time, but they can’t fit into a one-bedroom apartment,” Dranoff said. “So I think there’s going to be more of a trend to have larger apartments.”

Pestronk agrees, although he says that the Post Bros. Atlantic building on South Broad Street — which has 54 three-bedroom apartments — housed dozens of families before the pandemic. But he says that perceptions of crime in Center City since 2020 have pushed many high-income renters with kids out.

Still, Post Bros. family-sized units in Northern Liberties are renting quickly.

“Our average renter is continuing to get older and to have a higher income,” Pestronk said. “And as people continue to get older, they have families.”

Philadelphia’s lack of multifamily options isn’t unique. Around the country, most new multifamily buildings are dominated by studios and one-bedroom apartments. The reasons range from stairway requirements to regional segregation that allows suburban schools to isolate themselves from lower-income communities.

“We see some family size in the suburbs, but they’re very, very rare in the city,” said Brad Fouss, senior vice president for the Philadelphia area at OceanFirst Bank. “There’s just not the demand for them, and I think that really is around the school system. When people start having school-aged children, they usually want to move out to the suburbs.”

Regional inequality tends to feed on itself. It’s hard to get people with a choice to stay and have kids in the city, which means developers don’t try to build family-sized units for middle-income people.

As a result, it’s much easier to finance smaller apartment units in the city and single-family homes in the suburbs.

“All that matters is whether somebody will give you the money,” Pestronk said. “The first question every lender asks is ‘What are the nearby comps?’ If there are no other big units in your surrounding neighborhood, then it’s really hard to get the money.”

More obscure problems include building codes in North America that require every apartment be accessible by two staircases, in contrast with requirements in Asia and Europe. That creates long, windowless hallways. The apartments that flank them have a lot of dark interior spaces facing the hallway, which are often devoted to walk-in closets and extra bathrooms not ideally suited to families.

Then there’s the question of where apartments are allowed. Most of Philadelphia’s neighborhoods, including the areas most popular with families — like the Northeast and the Northwest — are largely zoned for single-family housing.

“Families often want to live in slightly more suburban areas of the city, so if you’re not allowing apartments there, you’re not going to get family-sized apartments,” Smith said. “If you asked me to rewrite the codes, I would have more land available for apartments and designs that allow more windows and more bedrooms.”

That diversity of housing is exactly what Bonarek wants in West Philadelphia. He lives in a historical rowhouse, with his kids, but would prefer a new multifamily unit that can accommodate them.

That isn’t an option, unless he wants to leave his neighborhood.

“The opportunity to live in a new flat, with no responsibilities outside your front door is very alluring,” Bonarek said. “I would gladly sell my house and rent to be able to live in that kind of arrangement. But in West Philly, there just isn’t anything. If you want more than a one-bedroom apartment, it’s very difficult.”